India’s private sector growth moderated in October 2025, according to the HSBC Flash India Composite Purchasing Managers’ Index (PMI), which slipped to 59.9 from 61.0 in September. While the reading remains well above the 50-mark that separates expansion from contraction, it marks the lowest level since May, signaling a slight cooling in business momentum.
Key Highlights
- Composite PMI: Fell to 59.9 in October from 61.0 in September
- Services PMI: Dropped to 58.8 from 60.9, indicating slower growth in service activity
- Manufacturing PMI: Rose slightly to 58.4 from 57.7, showing resilience in factory output
- New Orders: Continued to grow but at the slowest pace since May
- Export Orders: Slipped to a seven-month low amid softer global demand
- Input Costs: Eased slightly, but firms still raised selling prices to protect margins
What’s Driving the Slowdown?
- Services Sector Softness The services industry, which had been a key driver of growth in recent months, saw a notable deceleration. This was attributed to weaker domestic demand and cautious consumer spending.
- Global Headwinds Export orders declined as global economic conditions remained uncertain. Slower international sales impacted both manufacturing and services, especially in IT and logistics.
- Price Pressures Although input costs eased, many businesses continued to hike selling prices to maintain profitability, which may have dampened demand.
Market Sentiment and Outlook
Despite the moderation, India’s private sector remains in expansion mode. The manufacturing sector’s resilience offers a buffer, and analysts expect demand to pick up during the festive season. However, the slowdown in services and exports could weigh on Q3 GDP growth.
For investors and traders, this data serves as a signal to recalibrate strategies. Sector rotation, defensive plays, and selective exposure to manufacturing and export-driven stocks may be prudent.
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Conclusion
India’s private sector continues to grow, but at a slower pace. With global uncertainties and domestic demand fluctuations in play, investors should stay agile and informed. The coming months will be crucial in determining whether this moderation is temporary or part of a broader trend.
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